Country Analysis Note

Although not a significant producer of liquid fuels, the Netherlands plays an important role as a European liquid fuels transportation and processing hub.

The Netherlands is the second-largest producer and exporter of natural gas in Europe, following Norway, and the Netherlands is home to Europe's largest natural gas trading hub in terms of spot volumes.

The Netherlands is a major petroleum liquids refining and storage center. As of January 1, 2015, the country had 1.2 million barrels per day (bbl/d) of crude oil refining capacity, according to Oil and Gas Journal. At the beginning of 2014, the country had more than 210 million barrels of storage capacity, with the majority (more than 170 million barrels) located in Rotterdam. Additionally, the Port of Amsterdam serves as a major hub for gasoline storage, blending, and transshipment.

Petroleum accounted for just over half of Dutch energy consumption in 2012. EIA estimates that the Netherlands consumed about 980,000 bbl/d of oil in 2014, but domestically produced only 66,000 bbl/d. The country imported crude oil primarily from Russia, Norway, Nigeria, the United Kingdom, and Saudi Arabia.

The Netherlands produced just over 3.0 trillion cubic feet (Tcf) of natural gas in 2013. Most of its natural gas fields are located offshore in the North Sea, although a number of them are located onshore, including Groningen, one of the ten largest natural gas fields in the world.

The government has capped annual natural gas production at the Groningen field as part of a policy to encourage production from smaller fields and to prolong the life of the field. This field acts as a swing producer to help balance the high seasonal fluctuations in demand in northern Europe. To help meet the increased winter demand for natural gas in the Netherlands and in Northwest Europe, gas production from the Groningen field in January is generally around double output in July. In both January 2014 and December 2014, the Netherlands' government reduced the annual cap on production from the Groningen field because of concerns over an increase in the frequency and intensity of earthquakes in the area. The government production cap was 1.5 Tcf for 2014, more than 20% lower than the nearly 1.9 Tcf produced from Groningen in 2013. In December 2014, the Dutch government set the cap for 2015 at 1.4 Tcf, but in February 2015, the government further reduced the cap for the first half of 2015 to just 0.6 Tcf.

Natural gas produced in the Netherlands is shipped via an extensive domestic and export pipeline system, which directly connects the country with the United Kingdom, Germany, and Belgium and indirectly connects it to most of Europe.

In addition to pipeline natural gas, the Netherlands now serves as a transport hub for liquefied natural gas (LNG). The Gas Access to Europe (GATE) LNG terminal became operational in September 2011. While initially designed to unload, store, and regasify LNG and deliver the gas into the pipeline system, the terminal can also act as a break-bulk and re-export facility, loading LNG onto trucks or small ships for distribution in Northwest Europe, or reloading LNG onto large ocean-going tankers for re-export throughout the world.

The Netherlands is also home to the Title Transfer Facility (TTF) natural gas hub, the largest and most liquid natural gas hub in continental Europe. TTF has also been the fastest-growing natural gas hub in Europe, and in 2014, TTF surpassed the United Kingdom's National Balancing Point hub in terms of spot volumes traded.

The Netherlands consumed 1.6 Tcf of natural gas in 2012, accounting for approximately 36% of total energy consumption. Most natural gas is consumed by the electric power, residential, and commercial sectors.

The Netherlands net electricity generation was approximately 94.9 billion kilowatthours (BkWh) in 2012, mostly from fossil fuel-fired power plants. More than 12% of the Netherland's electricity is generated from renewable sources, mainly biomass and waste (7% of the total) and wind (5% of the total). The Dutch power system is connected to Belgium and Germany, as well as to Norway and the United Kingdom via high voltage lines that run along the North Sea bed.